State of Oklahoma Phillips v. Guy Atkinson Co

Decision Date02 June 1941
Docket NumberNo. 832,832
PartiesSTATE OF OKLAHOMA ex rel. PHILLIPS, Governor v. GUY F. ATKINSON CO. et al
CourtU.S. Supreme Court

Messrs. Claude C. Hatchett, of Durant, Okl., Randell S. Cobb, Mac Q. Williamson, and William O. Coe, all of Oklahoma City, Okl., for appellant.

Mr. Charles Fahy, Asst. Sol. Gen., for appellees.

[Argument of Counsel from page 509 intentionally omitted] Mr. Justice DOUGLAS delivered the opinion of the Court.

This case involves primarily the constitutionality of the Act of June 28, 1938, 52 Stat. 1215, insofar as it authorizes the construction of the Denison Reservoir on Red River in Texas and Oklahoma.1

The bill in equity was filed by the State of Oklahoma seeking to enjoin the construction of any dam across Red River within the domain of Oklahoma which would impound the waters of the Red River (or its tributary, Washita River) so as to inundate and destroy any of the lands, highways or bridges belonging to or under the jurisdiction and control of the state or which would obliterate or interfere with its boundaries. The bill also seeks to restrain the institution or conduct in any court in Oklahoma of proceedings to condemn lands for the purpose of the dam or reservoir.2

The bill alleges that Oklahoma will be injured in the following manner by construction of the project: The greater part of the dam will rest on Oklahoma soil and will form a reservoir inundating about 150,000 acres of land, of which 100,000 acres are located in Oklahoma. Of those acres about 3,800 are owned by the state. The United States will acquire title to the inundated land. The land owned by the state is used for school purposes, for a prison farm, for highways, rights of way, and bridges. The basin to be inundated is inhabited by about 8,000 Oklahoma citizens. Much of the land is rich soil in a high state of cultivation. Much of it has large potential oil reserves. On some of it there are large producing oil wells and on other parts there are drilling operations and exploration for oil and gas. At least 15,000 acres will be highly productive oil lands and at least 50,000 acres are underlaid with oil and gas. There are thirty-nine school districts and townships in the four counties in which the affected area is located. Those governmental units are largely supported by ad valorem taxes. The taking of the 100,000 acres wil decrease the taxable property in each of the counties and take virtually all of the taxable property in many of the t wnships and school districts. Each of these governmental units has a large bonded indebtedness payable from an annual levy of taxes. Inundation of the land will deprive those units of much of the tax revenue, so that many will be practically destroyed and the remainder seriously hampered. Since the state derives much of its revenue from a gross production tax on oil and gas, it will suffer great losses in tax revenues from the inundation of the oil and gas lands. The 'annual wealth production' to the citizens of Oklahoma from the lands in the reservoir basin is about $1,500,000. Aside from such losses and losses from oil revenues and personal property taxation, the net taxable loss to the counties, townships and school districts will be about $40,000 annually.

It is also alleged that the construction of the dam will be a 'direct invasion and destruction' of the sovereign and proprietary rights of Oklahoma in that: the boundary of Oklahoma will be obliterated for approximately 40 miles (see Oklahoma v. Texas, 260 U.S. 606, 43 S.Ct. 221, 67 L.Ed. 428); there will be a 'forcible reduction of the area of plaintiff as one of the United States'; lands owned by it will be taken; its highways and bridges will be destroyed causing an interruption in communication between various parts of the state; the waters to be impounded belong to Oklahoma but will be taken from it without payment of just compensation those waters will be diverted from Oklahoma and will be run through turbines located in Texas for the generation of power for sale principally in Texas; the removal of citizens from the 100,000 acres of land will create a 'serious social and economic problem', the burden of which will fall on Oklahoma for which no compensation is afforded.

The bill incorporates H.Doc.No.541, 75th Cong., 3d Sess. (hereinafter called the Report) which contains the War Department's survey and recommendations on the Denison Reservoir and which served as the broad definition of the project which was authorized by the Act of June 28, 1938. The bill alleges that under the statutory scheme flood control and power purposes are 'inextricably and inserverably involved'. It alleges that, as described in the Report, the first 110 feet of the dam are to be used 'solely and exclusively for the development of waterpower', while 40 feet 'superimposed' on the power reservoir are to be used 'solely and exclusively' for flood control. That is to say, from elevation 510 feet (sea level) to 590 feet there is to be a dead storage pool for waterpower head, from 595 feet to 620 feet there is to be a water power reservoir, and from 620 feet to 660 feet there is to be a flood control reservoir. It is alleged that those purposes are 'functionally separate and neither is the incidental or necessary result of the other'; that the same part of the reservoir will not and cannot be used for both flood control and waterpower purposes; and that the power portion of the dam is created at the expense of its utilization for flood control. The bill further alleges that as a result of the modification of the statutory plan set forth in the Report the dam is being constructed so as to provide dead storage for water head from 510 feet to 567 feet, a power pool reservoir from 587 feet to 617 feet and a flood control reservoir from 617 feet to 640 feet. It is alleged that by reason of that modification the reservoir will inundate 3,080,000 acre feet for power and 2,745,000 acre feet for flood control as contrasted to 3,400,000 acre feet for power and 5,900,000 acre feet for flood control under the original plan;3 and that, as a result, the statutory scheme has been charged from one preponderantly for flood control to one preponderantly for water power. It is also alleged that no part of the Red River in Oklahoma is navigable.

The bill alleges that the Act under which appellees are proceeding is unconstitutional in that it violates the Tenth Amendment, that it is not within the powers of Congress conferred by Art. I, Sec. 8 of the Federal Constitution, and that since appellees are acting under a void and unconstitutional statute they should be enjoined. By an amendment to its bill, the state of Oklahoma also challenges the constitutionality of § 4 of the Act of October 17, 1940, 54 Stat. 1200,4 Pub. No. 868, c. 895, 76th Cong., 3d Sess. The amended bill alleges that the project 'does not in any way protect or improve the navigable portions of the lower reaches of Red river or of the Mississippi river either by enriching the low water flow * * * as the incidental result of the operation of said flood control and hydroelectric power project, except in the intangible, indirect, inconsequential and unsubstantial way' set forth in the Report; and that such inconsequential and intangible benefits to navigation as may result will flow from the flood control, not the power feature, of the project.

By motions to dismiss the appellees asserted, inter alia, that the Acts of Congress so challenged were constitutional and valid. The case was heard by a three judge court (Act of August 24, 1937, c. 754, § 3, 50 Stat. 751, 28 U.S.C. § 380a, 28 U.S.C.A. § 380a) which sustained the Act authorizing the project. D.C., 37 F.Supp. 93. From a judgme t dismissing the complaint and denying the injunction, a direct appeal was taken to this Court.

We are of the view that the Denison Dam and Reservoir project is a valid exercise of the commerce power by Congress.

This project is a part of a rather recent chapter in the long history of flood control on the Mississippi River.5 The federal government had concerned itself with the problems of navigation and flood control on that river long before6 the establishment of the Mississippi River Commission, 21 Stat. 37, 33 U.S.C.A. § 641 et seq., in 1879. Earlier efforts towards a more comprehensive flood control program on a national scale7 were accelerated by the disastrous Mis- sissippi flood in 1927. The agitation and concern over that disaster8 led to the enactment of the Flood Control Act of May 15, 1928, 45 Stat. 534, § 10 of which provided that the Secretary of War should submit to Congress 'at the earliest practicable date projects for flood control on all tributary streams of the Mississippi River system subject to destructive floods which projects shall include: The Red River and tributaries * * *.' 33 U.S.C.A. § 702j. That section of the Act also required a report on the effect on flood control of the lower Mississippi to be attained through the use of a reservoir system, the 'benefits that will accrue to navigation and agriculture' from the prevention of siltage and erosion, the 'prospective income from the disposal of reservoired waters', and 'inquiry as to the return flow of waters placed in the soils from reservoirs, and as to their stabilizing effect on stream flow as a means of preventing erosion, siltage, and improving navigation.' Pursuant to that authorization and direction a report (H.Doc.No.378, 74th Cong., 2d Sess.) was submitted on December 2, 1935, dealing at great length with the problems of the Red River and its tributaries and their relationship with the Mississippi.

On June 22, 1936, there was enacted9 the Flood Control Act of 1936, 49 Stat. 1570, 33 U.S.C.A. § 701a et seq. Section 1 of the Act set forth a broad Congressional policy, stating, inter alia, that 'the Federal Government should improve or participate in the improvement of navigable...

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